In today’s briefing:
- Hamamatsu Photonics (6965) – Toyota Selling Yet Another Cross-Holding
- Sanyo Industries (TYO 5958) – $60m Net-Net With 5 P/E, 3.8% Dividend, That’s Buying Back Shares
- Hyun Song Shin on How Big the Yen Carry Trade Really Is
- D. Western Therapeutics Institute (4576 JP) – News Flash
- Frontier Management Inc. (7038 JP) – 2Q Follow-Up
- Japan Business Systems (5036 JP) – 3Q Follow-Up
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Hamamatsu Photonics (6965) – Toyota Selling Yet Another Cross-Holding
- Today after the close we got news that after a year-plus of Hamamatsu Photonics Kk (6965 JP)‘s sliding stock price, Toyota Motor (7203 JP) is selling their 5+% stake.
- The offering is standard. Probably prices 9 Sep 2024. HP’s amended buyback program and probable index upweights offset most of the offering size over the next several months.
- So investors have to decide whether they want to catch the falling knife.
Sanyo Industries (TYO 5958) – $60m Net-Net With 5 P/E, 3.8% Dividend, That’s Buying Back Shares
- Sanyo Industries Product Categories Sanyo Industries (TYO 5958) is a manufacturer of construction materials that’s been in business since 1948.
- Their main products are sheet metal works used for flooring, roofing, aluminium building materials, and rooftop ventilators.
- They also manufactur earthquake and other disaster resilient components.
Hyun Song Shin on How Big the Yen Carry Trade Really Is
- The carry trade involves borrowing in lower yielding currencies like the yen and investing in higher yielding assets
- The recent unwind of the carry trade caused temporary market stress, but quickly settled down
- The actors involved in the carry trade range from speculators to institutions, making it a diverse ecosystem with varying motivations and impacts
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D. Western Therapeutics Institute (4576 JP) – News Flash
- H-1337 dosing commenced in PIIb clinical trials in the US in Aug-2023.
- The study is a multicenter, randomized, double-blind, active-controlled, dose-finding study investigating the efficacy and safety of H-1337 in patients with glaucoma and ocular hypertension by application of eye drops for 28 days.
- The number of patients is 200 cases in 4 groups: H-1337 0.6% (twice daily), 1.0% (twice daily), 1.0% (once daily), and Timolol (beta blocker drug for efficacy comparison, twice daily).
Frontier Management Inc. (7038 JP) – 2Q Follow-Up
- In terms of topline, both the Management Consulting Business and the Revitalization Support Business continued to perform favorably, achieving net sales of ¥2,908 mn (+14.3% YoY) and ¥791 mn (+5.6% YoY), respectively.
- The M&A Advisory Business reported net sales of ¥746 mn (-52.3% YoY).
- The Investment Business posted significant growth (+117% YoY), though its scale remained small with net sales of only ¥39 mn.
Japan Business Systems (5036 JP) – 3Q Follow-Up
- When JBS announced recording an impairment loss associated with the acquisition of NEXTSCAPE on 2Q results, it only revised down the initial FY24/9 forecast for profit attributable to owners of parent from ¥3,450mn → ¥1,500mn, leaving the rest of the forecast unchanged.
- While the impairment loss was clearly disappointing, it is important to keep in mind this is a non-cash item, and prompt action by JBS management in writing down the entire remaining portion of unamortized GW minimized future downside risk.
- As described on the next page, 3Q cumulative (9M) consolidated net sales rose +29.0% YoY, and operating profit rose +28.5% YoY, relative to full-term initial guidance for FY24/9 consolidated net sales +12.4%, and operating profit +21.6%.